Trade needs orderly markets - The Packer

Trade needs orderly markets

09/28/2012 09:39:00 AM
The Packer Editorial Board

A pair of developments are poised to affect trade relations between the U.S. and Mexico — one a potential improvement, the other a complication.

The improvement: Mexican trade authorities recently proposed to expand U.S. fresh potatoes’ — currently limited to a 16-mile zone along the border — access throughout the country.

The proposed expansion could mean up to 80 million more consumers for U.S. spuds, with a projected export value of nearly $150 million.

That’s obviously a hopeful sign for U.S. potato growers.

It’s also a positive indicator for cross-border trade for importers and exporters on both sides of the border.

The complication: The U.S. Commerce Department has announced a preliminary decision to end the tomato suspension agreement between Mexican growers and the U.S., which has regulated tomato prices since 1996.

The fate of the suspension agreement could cause problems beyond the tomato market.

U.S. exporters of grapes, pears and cherries know all too well about getting hit with blowback from a trade dispute.

These and other exporting industries found themselves as collateral damage, slapped with steep duties, after the U.S. failed to honor its commitment to a pilot program for Mexican trucks in 2009.

The potential for disruption throughout the tomato supply chain in the U.S. could damage suppliers in the U.S. and Mexico, as well as retail and foodservice customers reliant on stable and predictable supplies and pricing.

A swift and equitable resolution must be the priority for U.S. and Mexican industry and government representatives.

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